Five things to consider about the Texas foreclosure process before you buy a foreclosed home

Texans may think buying a foreclosed home is a good option because the homes sold at a foreclosure auction sell at a fraction of their true worth. You still should have a plan before you buy any Texas home at a foreclosure auction. It is best to know something about the Texas foreclosure process.

Understanding what happens during the foreclosure process and what happens during a foreclosure auction can help you snag a bargain, if you follow the following five tips.

Research – Before you buy any house at a foreclosure sale, it is helpful to know the Texas foreclosure process. What is the selling price of similar homes in the area? Do you know the owner history on the house sold at the auction? Do not skip doing the research; it is a valuable tool when buying any for closed home. Does the former owner have a lien on the property or are there unpaid taxes? What other fees will you have to pay besides the buyer’s premium or the price you bid on the house? You will not be able to get a walkthrough on the house before you buy, but looking at the tax history and carefully assessing how much you may have to spend on repairs may tell you if you are getting a good deal on a foreclosure house.

Bring your cash – You have a better chance of getting a house that is a foreclosure, if you have cash. It is best to make sure that you arrange funding before you place a bid. There is nothing saying you cannot finance a purchase of a foreclosed home with a FHA loan or grant from a charitable organization, you have the advantage using cash. Banks do not have to fill out as much paperwork if a buyer is making a cash purchase. Having cash makes this portion in closure of the Texas foreclosure process easier and lets you say ‘hello’ to a new house sooner.  

Know the opening bid – Arming yourself with this information can be crucial when it come to this final part of the Texas foreclosure process. It can tell you if you are getting a good deal on a house. The bank may want several thousand dollars above what the house may be worth; especially if you think it will more than $30,000 in repairs. You may not be getting such a good deal by bidding on a foreclosed property. Do not believe the stories of a bidder getting a house for $100. It is unlikely you will be able to counter a bank bid for $150. The opening bid does not mean a bid will begin at what a bidder thinks is a reasonable price in this last step of the Texas foreclosure process. It means the amount or opening bid the bank is willing to accept for the house. A bidder must always look at their budget, if they can flip a house fast enough to make a profit, and look at the current market conditions.

Inching up the price – There is no need to raise the price up by thousands at a bank auction. Simply watch what the other buyers are bidding and raise the price by increments of $50. You do not want to bid yourself up and pay more than you need to make a profit on a foreclosed home. Keep in mind how much you will pay and do stop bidding if the bids go higher than your agreed ceiling. You will not get a good deal if you pay more than you do want or the price is so high that you will not make much profit flipping a house bought at a foreclosure auction.

Have experience – If you plan to buy a foreclosure house, it is best that you knowledge about the Texas foreclosure procedure. If a house is up for bids at a foreclosure auction, it may not be a good deal if you have to pay for repairs and hire a professional to perform the work. If you can do some of the repairs yourself, you may be getting a good deal on a foreclosed home. You may make a good profit if you can make part of the repairs yourself, instead of hire a professional. If you need some advice before purchasing a house at a foreclosure auction, please call Save My Texas Home at 512-271-5044 today. We can help you decide if you can afford a foreclosed home and decide if getting a house through this Texas foreclosure process is a good idea.

Leave a Reply

Your email address will not be published. Required fields are marked *